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Mobile Virtual Network Operator (MVNO)

Mobile
Virtual Network Operator (MVNO) is a GSM phenomenon
where an operator or company which does not own a licenced sprectrum
and generally with out own networking infrastructure. Instead MVNOs
resell wireless services under their brand name, using
regular telecom operator's network with which they have a
business arrangements. Usually they they buy minutes of use
from the licenced telecom operator and then resell minutes of usage to
their customers of MVNO. Currently MVNOs are emerging in fast
pace in European markets and beginning in USA also. Slowly MVNO
phenomenon catching up in Asia and other parts of the world
also.

An example for MVNO is
Virgin Mobile. Virgin Mobile plc is a mobile phone service provider
operating in the UK, Australia and Canada, and the US. The company was
the world's first Mobile Virtual Network Operator, launched in the UK
in 1999. It does not maintain its own network, and instead
has contracts to use the existing network(s) of other providers. In the
UK, Virgin Mobile uses the T-Mobile network. In the US, the
Sprint network is the carrier. In Australia, Virgin Mobile operates on
the Optus network. In Canada, it uses the Bell Mobility
network. These networks use different technology (GSM in the UK and
Australia and CDMA in the US and Canada).

Usually MVNO's do not have
their own infrastructure, some providers are actually deploying their
own Mobile Switching Centers (MSC) and even Service Control Points
(SCP) in some cases. Some MVNO's deploy their own mobile Intelligent
Network (IN) infrastructure in order to facilitate the means to offer
value-added services. In this way, MNVO's can treat incumbent
infrastructure such as radio equipment as a commodity, while the MVNO
offers its own advanced and differentiated services based on
exploitation of their own IN infrastructure. The goal of offering
value-added services is to differentiate versus the incumbent mobile
operator, allowing for customer acquisition and preventing the MVNO
from needing to compete on the basis of price alone.

MVNO's have full control
over the SIM card, branding, marketing, billing, and customer care
operations. While sometimes offering operational support systems (OSS)
and business support systems (BSS) to support the MVNO, the incumbent
mobile operators most keep their own OSS/BSS processes and procedures
separate and distinct from those of the MVNO.

Characteristics
of an MVNO:

MVNOs are new breed of
wireless network operators who may not own the wireless spectrum, or
wireless infrastructure (also termed pipe, in colloquial terms) but
give a virtual appearance of owning a wireless network. These operators
lease the pipe or wireless capacity from traditional operators and then
repackage it for a specific vertical industry application.

Main added value that
MVNO provides is billing and customer care functions. In that sense
MVNOs own the customers.

MVNOs generally
provide both voice and data services to end users through a paid up
subscription agreement.

To become an MVNO, one
should cobble together a partnership that consists of a connectivity of
a regular telco, a customer base, and a sales channel. Most important,
they need unique and compelling data services.

MVNO Services

For now MVNO services have been limited, but analysts from EMC Research
have predicted that as wireless services grow, so will the availability
of niche MVNO applications. For instance, in the future a cell phone
user may be able to subscribe to a network operator plus multiple MVNOs
for specific data services over the same phone. One MVNO could provide
sports news, another weather and traffic and still another could
provide instant messaging capabilities.

MVNO's might also offer voluntary MVPN services based on the IPSec or Mobile IP VPN client to their customers, which allows to terminate the IPSec connection at a VPN gateway or HA in the MVNO data center and also supporting multiple access technologies.

In this way, each MVNO and
the network operator could focus on their own niche markets and form
customized detailed services that would expand their customer reach and
brand.

Regulation

So far MVNOs have not been regulated in any country. The ITU has
received several requests to study the issue, specifically to provide
input on whether government intervention is necessary to allow MVNOs to
offer services and applications at a lower price to consumers. This
would help to ensure a more efficient use of the spectrum but some
incumbent providers argue that the market is already competitive and
intervention is not necessary.